Segmenting international assignments: theorising expatriate reward

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Abstract

This chapter begins by briefly examining the typical content of expatriate reward policy. Following on from this, it addresses the trend to segment international assignment policies to reflect different assignment types and provide flexibility to organisations, while simultaneously attempting to reduce costs and maximise expatriate return on investment. It then takes as its focus theoretical frameworks that can help expatriate reward professionals to predict outcomes of their policy design choices. In so doing, it first examines the role of equalising differences or compensating differentials theory (Rosen, 1986) as a basis to justify differential treatment in expatriate reward within a segmented international assignment policy suite. Next, it reviews the impact of equity (and perceived inequity) (Adams, 1963) within a segmented policy approach on assignees’ potential willingness to accept assignments and remain satisfied with - and motivated by - reward policy while on assignment. Finally, the chapter draws upon the organisational justice literature to consider the reasonableness of procedures, the context surrounding these and the (unintended?) consequences of policy outcomes (Byrne and Cropanzano, 2001; Colquitt, Greenberg and Zapata-Phelan, 2005; Hansen, Byrne and Kiersch, 2013). ‘Distributive’ justice (Chory and Kingsley Westerman, 2009; Homans, 1961) is proposed as an appropriate theoretical framework to help predict assignees’ evaluation of what they receive compared to others; ‘procedural’ justice is set out as a frame to assist policy implementers to determine how outcomes are allocated (Palaiologos, Papazekos and Panayotopoulou, 2011); and ‘interactional’ justice is presented to address how decisions are communicated and implemented (Brown, Bemmels and Barclay, 2010; Gilliland, Gross and Hogler, 2014).